"I've been selling stuff on eBay on and off for a
few years now. When do I know if I have a 'real' business
going?"

You'd be amazed how often this question arises in the eBay
community. A lot of people--roughly 750,000 at last count--are
making either a full- or part-time living selling stuff on eBay.
Many of these folks started out selling things on eBay as a fun
"hobby," and they're shocked--shocked!--when they
learn that someone (like the IRS) sees them as more than that.

To help you out, here are 20 signs, David Letterman-style, that
your eBay selling activities are getting a wee bit beyond the
"hobby" stage:

20. You've run out of things in your attic and basement to
sell on eBay, but you're continuing to sell stuff from . . .
somewhere.

19. After putting your garbage out by the curb on pickup day,
you drive around the neighborhood to see if anybody is throwing
away anything interesting.

18. You've taken out classified ads in the local newspapers
offering to help other people clean out their attics and basements
on eBay--for a fee, of course.

17. You begin haunting local funeral parlors, like Paul Newman
in The Verdict, offering your eBay selling services to
bereaved relatives who just can't bear the thought of cleaning
out Mom's house.

14. You consider building out the shed in your backyard, or
adding a third story to your center-hall colonial, so you'll
have more room to store your inventory.

13. You keep your Chihuahua chained to your eBay inventory at
night so you can deduct him as a "guard dog." (Note: You
can deduct the expenses of maintaining a guard dog--such as
food--but not the dog itself, which has to be depreciated over his
or her "useful life.")

12. The first things you read in the newspaper every morning are
the liquidation and creditors' notices in the classified
section.

11. You carry rolls of hundred dollar bills to garage sales,
arriving just as the homeowners are putting out their stuff, and
offer to buy everything they have, sight unseen.

10. You own the complete works of Janelle Elms, Marsha Collier,
Joseph Sinclair and Jim "Uncle Griff" Griffith [leading
authors of eBay guidebooks].

9. You're on a first-name basis with every employee of your
town dump, the head of the local trucker's union, and every
freight liquidator, customs broker and factory outlet within a
50-mile radius.

8. You arrive at 6 a.m. for your local library's annual book
sale with 36 empty liquor boxes and three day laborers to help you
pack up your truck.

7. You have so many student interns helping you create eBay
auction pages the local community college has named a faculty chair
after you.

6. You know exactly where you can find motor vehicles that were
"formerly owned by drug dealers".

5. You know which brands of perfume, housewares and other
consumer goods are being discontinued by their manufacturers within
the next six months--and which distributors are likely to have
overstocks of these items.

4. The talk show hosts on eBay Radio
have your home phone number on speed-dial.

3. The local kids can't play basketball in the street
anymore because they're too busy dodging UPS trucks going to
and from your home office.

1. You make at least one penny in profit each year from your
eBay selling activities. If you make money selling on eBay, the IRS
really doesn't care if you're a "business" or a
"hobby"--they want you to report your income (i.e.
profits) from whatever it is you're doing on your tax return
and pay taxes on it.

Since you're going to have to pay taxes on your eBay selling
eventually, why not take the steps necessary to treat it as a
"real" business? That way, you can deduct lots of stuff
that people with hobbies simply can't do, and you'll have
an incentive to look for even more creative ways to make a ton of
money on eBay.

Cliff Ennico is a syndicated columnist, author and host of
the PBS television series MoneyHunt. His latest book is
Small Business Survival Guide (Adams Media).
This column is no substitute for legal, tax or financial advice,
which can be furnished only by a qualified professional licensed in
your state. Copyright 2005 Clifford R. Ennico. Distributed by
Creators
Syndicate Inc.